Burlington Board reviews FY24 audit; approval deferred to March after management-letter recommendations

City staff and external auditors presented Burlington's fiscal year 2024 annual audit to the Board of Finance on Feb. 18; the board received the report for information and agreed to take formal action at its March meeting to allow members more time to review supporting materials.

Brad (Clerk Treasurer's office) and Alina Corsak of the audit firm (Markham, recently acquired by CBIZ) reviewed the audit results. Auditors reported no material weaknesses or significant deficiencies but included three recommendations in the management letter: strengthen controls over journal entries and adopt a formal closing schedule; amend or align city ordinance language with collective bargaining agreements regarding the discount rate used to value pension-related liabilities; and improve IT access-security documentation for the New World financial system, including annual attestations of security permissions.

Brad summarized the city's financial position: revenues came in below budget while expenditures were also below budget; the net effect and use of prior fund balances produced an unassigned fund balance that the report put at approximately $6.159 million, or about 7.2% of expenditures, down from about $6.5 million previously. City policy targets an unassigned fund balance in a 5% to 15% range with a 10% target. Brad noted the city's downward trend in unassigned fund balance over recent years and presented scenarios showing how additional annual contributions would affect the target over time.

Auditor Alina Corsak explained that many of the late journal adjustments related to capital-asset reporting and consolidation processes that are among the final steps in producing government-wide financial statements; she said fewer late adjustments occurred this year and staff capacity improvements are underway. The auditors recommended clarifying ordinance language to reflect that pension discount-rate decisions are informed by the city's actuarial advisor and collective bargaining arrangements.

Former City Councilor Sharon Buscher offered public comment praising the emphasis the council and staff have placed on the audit and management letter and urged continued attention to internal process improvements. City staff said all supporting materials had been posted by the afternoon of the meeting and that a formal vote to accept the audit will be on the March Board of Finance agenda.